May 2, 1999

By NICHOLAS D. KRISTOF

TOKYO UNDERWORLD
The Fast Times and Hard Life
of an American Gangster in Japan. By Robert Whiting.
Illustrated. 372 pp. New York:
Pantheon Books. $27.50.

icola Zappetti was one of the first American conquerors to arrive after Japan's surrender at the end of World War II, and he showed his true colors immediately. Then a 22-year-old Marine sergeant in charge of seizing an airstrip, he instead posted his men in a geisha house and paid for the women's services with confiscated yen.

Zappetti was not the kind of fellow who did things by the rules. His ''flexibility'' led him to become an American tycoon in Tokyo, most famous for his pizza restaurants but deeply mixed up in just about anything that was spicy or unethical. From gambling to smuggling to diamond theft, Zappetti had a varied career, although by the time he died in 1992 he was a frail and embittered old man who railed at everything Japanese, even telling American men visiting his restaurants to be sure not to marry their Japanese dates.

In most books, history is made of sterner stuff, and so conventional accounts of modern Japan, filled with prime ministers and such, are important and earnest and dull. ''Tokyo Underworld'' is the opposite: not particularly consequential, but a fun book about a wretched character. Robert Whiting, an American writer living in Tokyo and the author of ''You Gotta Have Wa,'' tries to add context in order to illuminate Japanese-American relations as a whole, but fundamentally this is a yarn rather than a tome.

The yarn focuses on Zappetti but also incorporates the stories of various Japanese gangsters and lowlife types, illuminating what to me has always seemed one of the central paradoxes of modern Japan: random muggings are almost nonexistent, but institutionalized robbery is routine -- through such shady practices as bid-rigging by construction companies that pay off politicians. Japan has the most honest used car salesmen in the world along with some of the most crooked politicians, and Zappetti's story explores that conundrum.

One of 11 children of a carpenter from Italy, Zappetti was raised in the Italian ghetto of East Harlem. Several family members were in the Mafia, and the next-door neighbor was a professional hit man. Zappetti might have grown up to be a low-level Mafia enforcer if not for opportunities created by the end of World War II and the rise of Japan. Americans tend to have sweet thoughts of the Occupation as an era when friendly G.I.'s had a hand outstretched with candy for Japanese children, but there was plenty of larceny going on with the other hand.

Indeed, the soldiers stationed in Japan each month remitted to the United States a sum that exceeded their total payroll. When the Bank of Japan entrusted the United States Army with 800,000 carats of diamonds, the diamonds simply vanished. When the Tokyo police force handed over its guns to the Americans, the entire armory somehow disappeared.

In sum, this was an ideal moment for a man like Zappetti. He retired from the Marine Corps and became a black marketeer, diverting truckloads of beer intended for American troops and selling it to Japanese gangsters. Zappetti then diversified into bad checks, stolen spaghetti, smuggled lighter flints, rigged slot machines and similar ventures.

Zappetti sometimes got into trouble, as when he supplied a gun for a famous diamond robbery in the Imperial Hotel in 1956. Arrested and interrogated, he was finally released on payment of an $800 fine, but the episode forced him into new business directions. So he opened up a pizza restaurant, which became an enormous hit among foreigners desperate for a good pizza. Visiting Americans from John Wayne to Frank Sinatra dropped by, and Emperor Akihito (then the crown prince) courted Empress Michiko there.

Whiting, who interviewed Zappetti at length before his death, tells us that his subject lost most of his money and property over the years through divorces and lawsuits and idiotic ventures. In the early 1990's, he was planning to hire some killers to knock off everybody who had ever crossed him -- he got a bid for the contract killings from one gang, based on a group rate -- but before he could work things out, he suffered a heart attack and died. His legacy today is the Nicola's restaurant chain in Japan (now owned by a Japanese company) and the thickest file that the Japanese police ever collected on an American.

Nicholas D. Kristof is Tokyo bureau chief of The Times and the co-author, with Sheryl WuDunn, of ''China Wakes.''